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       login  Use the system password database for authenticating
              the peer using PAP, and record the user in the sys-
              tem wtmp file.  Note that the  peer  must  have  an
              entry  in  the /etc/ppp/pap-secrets file as well as
              the system password database to be allowed  access.

I see no other reference to wtmp, but maybe it'll work for CHAP anyway.
(This jives with my lack of CHAP knowledge.  The password is probably
transmitted in an incompatibly encrypted manner, huh?) If not, surely it
would be an easy hack to copy over the wtmp-specific stuff, since it's
already there.

-Bitt